Posted
by
kdawson
on Saturday February 06, 2010 @09:47PM
from the such-a-deal dept.

gjt writes "I initially posted a piece ragging on the Nexus One. But then a commenter pointed out a problem with my initial logic, and after doing some math I concluded that the $529 unlocked/unsubsidized Google Nexus One gPhone is much cheaper than it appears to be. In fact it's only $49 over two years — and that's unlocked! Google likes to say that the Nexus One represents 'Our new approach to buying a mobile phone.' But it actually seems as though T-Mobile deserves most of the credit by providing a $20/month discount to customers who purchase an unsubsidized phone, a fact that didn't seem to get much attention when T-Mobile created the plan last October."

So, the real cost of an unlimited everything plan is $99.99/mo for subsidized phone buyers. Compare that to the $79.99/mo plan for unsubsidized buyers and that’s a $20/mo savings. Over two years, that’s a whopping $480 savings.

So, $529 – $480 yields a final purchase price of just $49!

Except that the phone is still $529! You're just buying the most expensive package available and think you're saving money, which makes no sense.

Everything in Europe has been traditionally unlocked and unsubsidized phones. You buy the phone and then you get a subscription from your favorite operator. They have added the subsidized option but almost no one buys his/her phone like that. It's just stupid, which the article writer seems to have "discovered" here.

Think of a wife as an PCIx16 slot. You give it resources, it makes things look pretty, takes care of a lot of ridiculous details that you wouldn't otherwise care that much about, and occasionally overheats and gets bitchy about your configuration.

Some really high-end cards allow you to spawn whole new processes, and that's worth the price of the upgrade.

Seriously, I never understood the whole "you have to spend money to save money" mentality that so many people have.

I understand it this way: If you buy too cheap, you may have to buy the same thing of kind again in the future when it breaks, or turns out to be not good enough for your needs.

For instance, my recent experiences with that:

1. I bought a high end point and shoot camera before going on vacation. Took me about 2 days to realize that it still wasn't good enough, and that I couldn't make it better by putting another lens on it, because they're not interchangeable. Now I have a DSLR and am much happier with the results. It's a midrange sort so it could be better still, but with a DSLR I have enough flexibility that I almost never happen to be in a situation that a better camera would make something significantly better. That was a waste of money on the P&S.

2. Some time ago I bought a fairly high end phone... with a T9 keyboard. It was capable of fairly decent web browsing, and could run applications, but was utter horror to type anything with. I'd have been much better off with something with a real keyboard. I could have got that for $50 more. In hindsight that was a waste. Now I have a N900 and couldn't be happier.

3. I tried VIA's MiniITX boards as a way of having a "cheap server". Turned out to be anything but, because it was horribly unreliable, so after months of fighting with it, it now sits in the closet.

So, overall, buying too cheap often turns out expensive, when the cheap product isn't good enough and has to be replaced. Then you end up buying two things instead of one.

I have no clue in what country you life but I assure that everything in the Benelux + Germany is locked. You get the phone for 'free' and a laptop or in some cases even a car.... but the phone is locked and your contract too. Almost nobody buys a phone here (unlocked for the full price) and then goes to see which provider is best. Wouldn't make sense either, all the providers have equal coverage and price difference's are small.

If the phone is locked can you use it in a different country without restrictions? Can you buy a SIM in a different country and use that SIM while you are away? If not, there are good reasons to buy an unlocked phone.

No. Locked phone = no SIM swapping, neither at home nor abroad. One exception: MVNO that use your original provider's network, but that's not very interesting.

I don't know about the rest of Europe, but the law in France forces the operator to unlock your phone for free after 6 months (or for a fee up to € 65 before). So the locked phone issue only exists for the first 6 months of a contract (you've got to request the unlock, though). I always keep a previous phone, just in case.

I have no clue in what country you life but I assure that everything in the Benelux + Germany is locked. You get the phone for 'free' and a laptop or in some cases even a car.... but the phone is locked and your contract too. Almost nobody buys a phone here (unlocked for the full price) and then goes to see which provider is best. Wouldn't make sense either, all the providers have equal coverage and price difference's are small.

Things must have changed since 2001 when I (and most soldiers I knew) bought cell phones at full price and then got SIM cards for D2, etc.

I moved to italy and it was the same deal. I really liked the european cell-phone system... I miss it...

Here in Norway you can easily get both locked and unlocked phones, though pretty much all advertised products are locked. Typically for 1 year, after which unlocking is a phonecall away. Done this myself twice, never any hassle. However, with the exception of the phone I got 4 years ago (locked a single month, at a 150 euro discount), taking the bundled contracts seem to always come out more expensive than getting an unlocked phone and choosing another contract that suites your usage pattern. No idea how the sales-ratio between locked/unlocked phones are.

When you buy a phone including a plan it'll no doubt be locked, but it's real easy to get the same phone without a plan.

Especially in the larger cities it's easy to find a small shop that for a small fee will unlock just about any phone and there's nothing illegal about it.

Because I feel it's giving me more software freedom than a Droid I'm looking at a Nokia N900 right now, not as a phone but purely as a mini computer with the option of VOIP, it's all over the place, unlocked and for about €550.00.

Actually, lately a few things like O2 Germany's "My Handy" have popped up, where they sell subsidized phones for decent rates (480€ over 24 months instead of 430€ up front for a Motorola Milestone, for instance... or at least those were the rates when I got mine). The phones are all completely unlocked, and, as far as I know, unbranded.

This is far from the norm, but schemes like it seem to be gaining speed...

Ah, but that's only after two years. If you don't upgrade, the subsidized phone plan ends up being way worse after 3 or even 4 years. That's the big reason the phone companies want you to go for the subsidized plan - they get to ream you after the 2 years.

I don't think that's his point. The first time I heard how mobile stuff is done in US I was really surprise too, actually I'm still even a bit.

Another thing that the separation of phone devices and service establishes is that in case I have multiple devices, be that either multiple phones or for example phone+3G dongle, I can just go to my phone company's site and click a button to request additional sim card for free. I can use them all at the same time and they're all under same contract (and for example

AT&T GoPhone. A ludicrous $0.01/KB if you don't buy a block of data, but you can buy a 100MB block that lasts up to 30 days for $19.99 (and if you buy another block of data before the 30 days is up, any unused amount from your previous block will roll over), as well as a 1MB block for $4.99. I use it with my unlocked Nokia E71, and it works great. While 100MB isn't much, I don't use my phone's data connection as if it were my primary internet connection; 100MB typically lasts me 2 or 3 months.

In the US "prepay" is synonymous with "I have bad credit so real companies wont deal with me" or "I don't use my phone". The prices for prepaid phone service are frequently twice per minute what it would cost under contract.

I have prepaid, I have excellent credit, and I do use my phone (though I suppose by a lot of people's standards it's barely using it). Over the course of 4 years, my highest monthly usage has been about 130 minutes and my lowest is about 25 minutes, so my monthly "bill" ranges from $2.50 to $13.00, with $4-6 being typical. My wife also has the same setup, and her typical usage is around $13-$15 a month. Our highest combined monthly usage over the 4 years was about $26/month total.

really? do people not realize that some of us on Tmobile have been grandfathered into amazingly cheap data plans such as the Tzones $5.99 unlimited data plan?
unlocked phones in the USA are always expensive. nothing new there.

Where exactly in Europe are you talking about because it's the complete opposite in the UK where everyone gets a phone with their 1 or 2 year contract. Another person mentioned it is the same in Germany too. This would seem to invalidate your "everything in Europe claim".

The only place I know where people buy the Phone and then a contract is in my homeland of Thailand.

And in EU you pay full price of the device. If you buy it without contract that is. What is this novice concept in USA that everyone's so freaked out about? You buy a phone, you pay its retail price. It's normal.

I do realise it'll take years for people (of USA) to realise that their phones cost much more than they paid [when they renewed the contract].

There are two plans at T-Mobile. One is when you get cheap phone, you pay $99 all unlimited. Or (!) you get identical T-Mobile plan for only $79 ($20 less

And this was talked about quite a bit upon release, so it did get a lot of attention on tech sites. gjt just wasn't paying attention and was too busy blogging. Then a commenter calls him out for being wrong and he submits to/. that he was wrong? What the Hell?

In Germany, almost everybody bought subsidized phones until maybe 1-2 years ago. But you always had the option to buy a unsubsidized phone. Which still was unlocked. (I have yet so see a single locked phone or offer in Germany.)

Luckily, nowadays, the prepaid options available are so great (e.h. blau), that there is no point in buying a subsidized one with a plan, unless you need one of those flat-rate deals where you pay nothing to call others in the same net (usually BASE & re-branded clones of it, or a local dealer like Alice).

And with even the “candybar” Nokia 5800 costing only than 250€, it’s possible to buy a phone just like that.

By the way: Wouldn’t you get a N900 for $529? With keyboard, Debian Linux / Maemo, etc?

By the way: Wouldn’t you get a N900 for $529? With keyboard, Debian Linux / Maemo, etc?

I would if I didn't mind carrying around a brick in my pocket all day. For that matter, for $529 I can get a decent 15" laptop. As-is, I'm very happy with my unlocked Nexus One. It's the only phone out there that's better than an iPhone, IMO. Of course, if you require a keyboard, the Motorola Droid is the way to go.

So, Google/HTC could have very easily made this one phone model compatible with not only T-Mobile and AT&T, but pretty much any 3GSM network worldwide if they only included the right combination of power amplifiers. According to iSuppli’s teardown of the Nexus One, [isuppli.com] the four small power amplifiers that are in the Nexus One only account for $2.20 in manufacturing costs. $2.20! How much more could a different combination of power amplifiers have cost? Maybe another $2 (at most)?!

It just sounds like a deliberate decision to aid the wireless carrier oligopoly. Given that we’ve seen HTC’s FCC documents to introduce an AT&T oriented version of the Nexus One, you’d think that overall engineering, manufacturing, warehousing, and sales expenses would be lowered enough by offering a single model that could replace two.

In other news, in the real world, adding chips to a design doesn't just cost component + assembly costs. It also increases the size of the device, and possibly the power consumption (though these can probably be put into a low enough power mode that it doesn't matter).

Making the device larger and heavier isn't something that's done lightly. Sure, this would only add a little bit, but *any* individual feature only adds a little bit. You have to draw a line somewhere.

since you're not a radio and hardware engineer, I guess it's not obvious to you that putting antennas and electronics for different frequencies does cost board space. It's not impossible but it's hard on a small phone and definitely more money.Yes, I'd also love a phone that does it all, but they aren't exactly common. It's not just HTC, it's pretty much everyone.

Especially if you look at the HTC Imagio on Verizon it is a worldwide phone that can use both CDMA and GSM bands. The GSM bands are locked in the US but if you call verizon and tell them you are going traveling you can get an unlock code so you can use it with pretty much any provider. So the only reason the nexus is locked down is insistence from T-mobile or Google.

Adding support for these extra bands costs something. Either higher price, heavier, bigger, or some other feature was left out to accommodate the extra radio hardware. There are entirely legitimate reasons for HTC and Google to leave this feature out.

the other phones that tmobile offer do not come close to the power the nexus one has. there's a reason why i don't own a mytouch or cliq. too slow of a cpu for AR based apps.

if people really were looking to save money, they'd:

1. call tmobile and get the tzone's $5.99 plan (some social hacking is involved since they claim it does not exist but it does.. you just gotta push).
2. buy the phone unlocked
3. have an unlimited data plan that works on an unlocked iPhone, Blackberry and any Android phone

So the ancient 528MHz chip (with a few small modifications, IIRC) that's been in use since the HTC Diamond is supposed to be comparable to the Snapdragon in the Nexus? What have you been smoking?

Don't get me wrong, the TP2 is a great device with a decent keyboard and pretty much _the_ WinMo work phone right now, but in terms of processing power, the Nexus won't even blink before throwing the TP2 off a cliff...

Most of your post doesn't make sense.
You can buy the phone full price and get on an unsubsidized plan for about $65 a month. $20 * 24 months = $480. full price of phone - $480 $180 (subsidized price) with contract

Not possible. T-Mobile is a cellphone company and therefor irredeemably evil. They cannot possibly deserve any credit for anything. I'm sure someone will explain how it is all really a plot to deprive you of your inalienable human right to unlimited free downloads and uncapped infinite bandwidth.

No, the real monster in the closet here is that the savings are still tied to buying a 2 year contract. So the phone is unlocked, but you're still stuck with crummy cell phone contracts in order to avoid dumping a bunch of money into the phone, which is what the contract will cause you to do in the long run. This is just sleight of hand taken to a new level.

... even here at SlashDot, society is infested with the innumerates! Arrrrh!

A DISCOUNT cannot be applied to a purchase price until/unless it is clear of other conditions. In this case, a 24 month service "contract".

The $20/mo can only be considered if the contract price is fully competitive with the offer you would otherwise take. Personally, I consider $60-75/mo utterly outrageous. The $20/mo makes them slightly less outrageous, but still usurous. I have a nice grandfathered sweet deal at $2-4/mo, bu

Aren't you guys tired of reading all the time the same big-brother phone-add "news" on slashdot? Since when this site started covering a 4 months old price as a news? What exactly do we learn here? Are moderators sold to google? Aren't the adds on google itself enough? If this was mobile phone dot com why not, but I (and I believe, the vast majority of readers here) are reading to learn about new stuffs in the IT world.
I'm getting sick of so much promotion for a device that doesn't deserves it and that is taking so much space and time on the web.

If this was mobile phone dot com why not, but I (and I believe, the vast majority of readers here) are reading to learn about new stuffs in the IT world.

Phones are the new stuff in the IT world. In 10 years, traditional desktops and laptops will be much less common, and most people will use phones (really, handheld computers that also make phone calls) and tablets. And hopefully glasses with heads-up displays.

Aren't you guys tired of reading all the time the same big-brother phone-ad "news" on slashdot?

I'm not.

I'm in fact really happy that there were good discussions about the Nokia N900 phone---otherwise I wouldn't have known about the existence of a smartphone which (supposedly) delivers exactly what I want: a pocket computer I can tinker with.

Being told that the thing I've been wanting for ten years finally exists is something I'm actually happy about. Was Nokia involved behind the scenes? Were they trying to push their product? Why would I care---I want the product at the price it's offered at.

Just like the other day where I was shopping for a scarf. The sales clerk notified me they had socks for sale. I tried a pair on, liked it, found the price reasonable, and I needed more socks, so I bought some. Yes, he applied a sales technique on me, and it worked. So what? His pitch didn't artificially inflate my need for socks, it told me "you can get what you want, and here's how: [...]".

And a while back I was looking for some stickers for my Rubik's cube. One of Google's advertisers had exactly what I wanted, at a price I liked.

Advertisements aren't that bad. It's just that 99% give all the good ones a bad name;-)

That is to say: yeah, I see a lot of ads I'd rather be without. But every once in a while, someone seeks me out wanting to sell me something, and it just so happens that I, before engaging with them, have a desire to buy what I then discover they sell.

If I like the transaction, why shouldn't I like being brought in contact with the other side of it?

And hey, if you don't like the headlines, you don't have to read the summary. And if you don't like the summary, you don't have to read the discussion. And you never have to read the article (see, I'm not new here).

http://coverage.t-mobile.com/default.aspx?MapType=Data [t-mobile.com]
If you are happy with 2-3 times the speed of dialup then go for it. T-Mobile only has 3G in a few select large cities. Cripples the phone in my opinion. Even AT&T has much much better 3G coverage. And Verizon throws Rev-A (3G) on all their towers which is why they have been winning the "map wars" recently.

This is bullshit. Not only do consumers prefer to pay later, fucking accountants prefer to pay later. Corporations prefer to pay later.

Apple tried this with the iPhone, too. The original iPhone was unsubsidized. People HATED it.

The subsidy is great because it makes it possible to buy an iPhone for $99 instead of a crappy feature phone. The extra $20 per month on the contract is offset by the fact that you're using a smartphone, it pays for itself. You make more sales or get a better job or save time or money compared to when you didn't have a smartphone.

STOP APOLOGIZING FOR ANDROID. It sucks and it won't get better until the people who use it demand that it get better. Google bought Android in 2005. Where are the results? iPad is going to ship with a $15 data plan and Skype calls, that is what was promised from the Google Phone. And iPad with 3G and 16GB is only $50 more than Nexus One.

Now, that $480 savings is $130 more than the $350 savings you get by selecting the $179 subsidized purchase option.

So, when you think about it, the $20/mo discount to unsubsidized phone buyers is effectively a rebate against the up front cost of the phone.

Good Grid! Does this guy actually think I am going to try to follow this spaghetti of weird math? "If you think about it, subtracting THIS amount if you get THAT option is almost like you could think of it as though you were saving THIS much beyond the discount with THIS OTHER option..."

Give me an effin' break!

Here is a hint for the author of TFA: when comparing costs, you don't need to subract ANYTHING. All you do is add.

Show me a simple chart:

Phone A with plan A costs THIS MUCH over two years. (Upfront cost + monthly charge over 2 years = total. No need to get any fancier.)

Phone B with plan A costs THIS MUCH over two years.

Phone A with plan B costs THIS MUCH over two years.

Phone B with plan B costs THIS MUCH over two years.

And so on. That's all it takes. I don't need to subract anything from anything and I don't need to "think of it as though" I were saving anything. I can just look at the damned chart and see what everything costs.

Jesus. Is this guy some kind of professional writer? Can I have his job?

i read a comment over at gizmodo that actually did seem to make sense.

google's release of the Nexus One is more of a raising the bar for other android hardware makers and in turn they didn't expect to sell tons of units or set the world on fire. rather, they are making other android handset makers step up their game to compete. plus, they can also test their device on a smaller carrier prior to unleashing it into the large boys like verizon and at&t.

I got one too and I love it. I'm not at all surprised about the low sales so far though, there's been no marketing. I'm guessing they wanted to start slow to work out the kinks and once it hits Verizon they'll probably step up the marketing and it will take off.

The Nexus One (like all Android phones) is data-hungry. It wants a 3G signal to perform well. EDGE sucks so bad you woild give the phone back.

Since there may not be ANY phone sold in the US that does 3G on both AT&T and T-Mobile, your choice of Android phone pretty much determines which carrier you use - you don't want to buy a Nexus One for use on AT&T, since it will be a slow data phone. Ditto for buying an iPhone 3G or 3GS to use on T-Mobile. It will be slow and disappointing.

Locking GSM data-intensive phones in the US is pointless, and a complete lie. If you want a 3G phone, your carrier determines which phone you buy. For now, anyways.

Now, when there is a 3G 'smartphone', Android or not, that can handle both A&T and T-Mobile 3G, then locking becomes important again. But for now, Android GSM phones need not be locked, and smart people at the carriers know this. They just go along as they always have, cause it makes sense to most of us.

On the CDMA side, it's more interesting.

In Europe, it seems GSM is pretty compatible. And locking is not a viable business model there.

So if you buy a locked Android phone, you know at least one party doesn't get it.

I read that the maker of the 3G chips HTC uses has a chip that can do both T-Mobile and AT&T networks. They just "released" it so it might take a while for a refresh of unlocked phones that can do either network.

>Now, when there is a 3G 'smartphone', Android or not, that can handle both A&T and T-Mobile 3G, then locking becomes important again.

The next version of the Android will support both of them and will support CDMA. I figure by then it'll be on a second hardware revision or at least a second or third radio firmware and be safe to buy.

>EDGE sucks so bad you woild give the phone back.

Funny how the first iphone was EDGE only. It sold pretty well. While I wouldnt wish EDGE on my worst enemy, its funny